The Fed backs off

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The Fed meets every six to seven weeks to discuss monetary policy with regional representatives called Fed presidents. They gather with Fed chairwoman Janet Yellen to discuss and vote on whether to raise or lower rates, or keep them the same.

On March 16, the Fed met and took a softer tone on raising rates this year.

After a historic interest rate rise in December — the first in nine years — the Federal Reserve initially estimated that it would raise the federal fund rate four more times in 2016 because it thought that the economy would be strong enough to warrant the increases.

On March 16 though, the Fed stated that it would be backing off of that prediction, citing that the global economy was potentially going to be a drag on our economy.

These comments sparked a rally in the stock market and also brought mortgage and treasury rates down.

Mortgage and treasury rates trade on a day-to-day basis just like stocks, moving based upon economic data. As of mid-March, mortgages rate stood at 3.75 for a 30-year, 3.625 for a 20-year and 3.125 for 15-year.

The market should remain neutral for the next 60 days, trading in a fairly narrow range. With rates at near all-time lows, this is a great time to buy or refinance a house.

To contact me, call 773-557-1000 ext. 15, e-mail or visit

About Ron Ricchio

Renato (Ron) Ricchio is president of Chicagoland Home Mortgage. He grew up in Westchester and attended St. Joseph High School and DePaul University, taking a job as a loan officer in the mortgage industry soon after graduating with a bachelor's in finance in 1991. He started his own company in 2001, which he operates today. He has been ranked in the top 150 loan originators in 2010 and 2011 by Origination News. Ron is happily married with three beautiful children. A board member of San Francesco Di Paola Society and the founder of Ricchio Family Toy Drive for Lurie's Children's Hospital, he enjoys cooking and spending time with family and friends.

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